In the nonfungible token (NFT) space, things are getting so bad that collectors are now selling them as tax write-offs.
NFT holders are increasingly offloading their digital collectibles. Some tax experts are now recommending harvesting losses made by “worthless NFTs.”
Selling at a loss can create tax write-offs that can reduce annual income tax bills. Tax-loss harvesting has become a key strategy this year as crypto and stock markets tank.
Strategically selling at a loss can offset gains from other investments. Savvy investors employ this strategy throughout the year to keep from accumulating excessive taxable gains.
Furthermore, a new website has been launched to help with the sale of unsellable NFTs.
Selling Worthless NFTs
The recently launched Unsellable website claims to help those with NFTs that have plunged in value. It noted that tax-loss harvesting can become problematic when NFTs are included.
“While every investment class has its losers, many of the NFTs we invested in were not only down big; they were now totally worthless… illiquid… unsellable.”
The website was created to provide liquidity for otherwise unsellable NFTs. The platform buys the tokens for pennies and provides the official receipt for tax purposes. Furthermore, it is keeping all of the tokens to build “The Unsellable Collection” to become the “ultimate artifact of the early days of web3.”
The platform charges a transaction fee of 0.0032 ETH plus gas. It offers 0.0000064 ETH (roughly $0.01) for each NFT it buys. The product, however, is the tax receipt which can lead to significant savings.
Compiled by Metacrunch. Metacrunch is a news complier and aggregator platform which aims to spread awareness and updates on Metaverse, Web 3.0 Technology, Blockchain, Cryptocurrency, NFTs, Airdrops and many more.
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